There’s a saying often made by some younger smart Alec to those of a certain age who let out a groan as they stoop to tie their shoe lace or, for a second, have forgotten why they opened the fridge: “Yes, old age doesn’t come on its own!”
It certainly doesn’t. According to the Office for National Statistics, in mid-2016 there were 1.6 million people aged 85 and over; by mid-2041 this is projected to double to 3.2 million.
And with old age, of course, comes the sore issue of social care. With Government, NHS and Council budgets already stretched trying to cope with a growing elderly population that requires social care, there is likely to be increasing pressure on people to cover more of their own care costs rather than the costs coming from the public purse.
Indeed, last weekend it was reported that the Government is considering launching a “Care ISA” the proceeds of which would be exempt from inheritance tax in an effort to solve the country’s social care crisis.
The proposal has generally been derided because it’s felt that, as well as complicating ISAs with the introduction of yet another brand, it will only benefit a small minority of wealthy investors.
Most of us don’t have to worry about inheritance tax but we do worry about social care. The days when we can just dismiss social care as something the public purse will pick up the tab for may be drawing to a close – indeed for those with savings over a certain level, it is already over to a large extent.
If you’re keen to have some peace of mind that you’re doing your best to prepare for a time where you may have to fund in whole or in part long term care costs, the good news is you can do so right now with Scottish Friendly’s ISA investment range.
ISAs are of course already tax efficient investment plans under current legislation. That’s because tax is not charged on any interest earned or gains made (other than dividends from UK shares) within an account. Tax treatment depends on individual circumstances and can change in future. The value of your ISA can fall as well as rise depending on the performance of your investments and the amount you invest is not guaranteed.
If you can put money aside for at least five years and ideally longer and even if you only want to set aside a proportion of what you invest for potential long term care, Scottish Friendly makes this easy. That’s because we let you set up your investment into separate policies (or “pots”) which you can assign for any goal or description you wish. It could be “Silver Anniversary Cruise Fund”, “Rainy Day Fund” or “Long Term Care Fund”.
And with contributions to each “pot” being distinct, it’s easy to monitor the amount you’ve contributed and the current value of your investments.
It’s easy to focus on the downside of old age but it does have its advantages – and I don’t just mean the free bus travel. Time for hobbies, for friends and family and for many the pleasure of grandchildren. But just as we can get the most out of our golden years if we’ve cushioned it with pension and investment provision of our own, so in future can we rest easy in the knowledge that we’ve put money aside for long term care should we need it and have to contribute to it.